Every day we’re hearing of a company running through a round of layoffs or going out of business, it’s really not a happy time. Sony is not immune to the economic troubles either. Sony is talking restructuring and that involves a potential head count reduction of 16,000 jobs due to plant closings.
This leaves Sony with some hard decisions. Restructuring can mean drastic changes that effect all their product lines. The PlayStation 3 isn’t currently a shining example of high profit margins. The console needs time to reduce its overall cost, chip sizes and bring profitability. Is it in danger?
“Sony’s not in a position to halt all domestic production but it has to do something that drastic,” said Mitsushige Akino, chief fund manager at Ichiyoshi Investment Management. “If it announces plans to move production overseas while keeping only planning and development functions in Japan, that would be a positive.” (gamestooge)
The yen is losing value in our global economy making it more difficult to export the product and build any type of profitability plan. “A source said this month the company will likely suffer an annual operating loss of about $1.1 billion, its first such loss in 14 years” (news.yahoo.com) All this noise is making CEO Howard Stringer contemplate Sony’s involvement as a “software only” company, making us recall the changes at SEGA to this same result.
The Financial Times reported Sony will unveil details of its restructuring steps on Wednesday or Thursday. It said Chief Executive Howard Stringer was meeting with resistance from some executives to shifting the company’s focus to software from hardware and cutting jobs in Japan. (news.yahoo.com)
Is this just a case of a fearful executive trying to lay plans for a more stable future? Software is easier to develop, pays for itself quickly and becomes pure profit as it ages. Hardware requires constant upkeep at manufacturing facilities, chip reductions and a boat load of quality planning for first shipment. Would Sony go full software?
Let’s face it, Sony isn’t SEGA, they’ve been developing hardware for consumers since anyone can remember and they’ve been doing it with quality and market penetration. It seems absurd to think they’d forgo hardware designs in replacement of a full software solution to the problem. In addition, Sony has already invested a large amount of cash into seeing PS3 through it’s 10-year plan and letting that die now is realizing a huge loss on investment.
If Sony pushes through the economic and maintenance course, the PS3 will become highly profitable, much like the PS2 last generation (with a slower ramp up for sales). Even if they break even after ten years it seems a lot better than throwing all the effort away.
Perhaps Howard Stringer is talking “software” for the next generation home console? You think Sony will create a PlayStation 4?
@Duke Nukem Forever review fiasco:
This one is almost ‘no comment’. The nasty side is what Jordan said (except foe Jonah I can’t yet distinguish your voices, sorry if I mix you up): they don’t mind blacklisting, they just don’t want it to be public.
@ Apple will be the games industry in 10 years:
You can even devise a control scheme for touch based interfaces, but!
Just like console controllers, a mouse and keyboard using player will best one using a console controller, in competitive gaming.
Jonah, I’m with you on the real books vs. kindle. Don’t get me wrong guys, that’s a device that I like, but it doesn’t hold a kandle 😛 to a real book.
@ No need for PS4, PS3 now hitting its stride:
Erm, hello, PS3 is hacked? Piracy will be as rampant on PS3 as is on PC? PS3 might become a very unattractive platform to develop for? (hard to code for it and with it’s DRM system exposed for all to pirate your product).
😀 Jonah, thanks for pointing out misspellings, it’s useful to me.
@Question of the Week:
I do care what it says in the review. I do want to read if a certain aspect is flawed: perhaps it is a feature that interests me, and in that case I’ll skip the game.
As for the score versus the entire contents, well, it actually depends on the value of the score.
If it’s below 5, then I don’t even bother to read the review. The score weights 100%.
If it’s up until 7, the score weights 50%. Above 7, it’s really up to the contents of the review, not the score: weight drops to almost 0%.
Just to let you know that things in Australia aren’t that bad. If one looks around abit you can get a good deal on games even if they are brand new. Granted prices have been $110 for some games but with some skill you can get it imported from the UK with shipping for nearly half the price. I havn’t brought a game from a major Australian retailer for some time now. Feel sorry for those who do ouch.